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What Does SoundCloud's Last Major Label Deal Really Mean?

It wasn't long ago that skeptical conjectures on whether SoundCloud could resolve its issues with takedowns and create a successful business model were dominating conversations around the streaming platform. Well, it seems SoundCloud is steadily proving the these naysayers wrong and wiggling its way towards a truly legitimate, long-lasting role in the industry.

Yesterday, SoundCloud officially announced that it has inked a deal with Sony Music Entertainment (SME), after reports started to roll in leaking the confirmed partnership.

Sony was the last holdout, and the landmark deal means that SoundCloud is now working with all three major labels (Warner Music, Universal and Sony) as well as Merlin Network, which represents the rights of 20,000 independent labels.

Just last year, Sony was pulling all of its music from the platform due to "lack of monetization opportunities." Now that SoundCloud has won them over, Sony is receiving stock and its artists will be able to monetize music through the streaming platform and take advantage of promotional, data and analysis tools.

Streaming is here to stay, and everyone (including the major labels, which were so opposed previously) is finally playing nice. First and foremost, the deal means that users have more music to listen to! Their extensive roster includes the likes of Beyoncé, The Weeknd, Future, Calvin Harris and Miguel, so these and many more will soon be available for streaming on SoundCloud.

If you’re a SoundCloud listener, this means you’ll get even more tracks to discover and enjoy. You’ll soon have access to music from SME’s exceptional roster of emerging artists and global superstars. (SoundCloud)

Secondly, it solidifies SoundCloud's positioning as a real contender in the burgeoning market of streaming services. And lastly, it gives the platform the opportunity to focus on rolling out its subscription service, which is expected to launch this year. A source close to the situation told Verge that "the deals SoundCloud struck with the majors does allow it to build a full on-demand service similar to Spotify or Apple Music."

According to sources, there have been talks of a $10-per-month subscription as well as a potential mid-tier offering. The efficacy of the paid tier(s) will be the last in a series of steps that will forever differentiate SoundCloud from its competitors, as the streaming platform is already winning in the categories of diversity, exclusivity and user friendliness for both artists and fans and currently maintains over 175 million users.

Having deals in place with all three major music labels means we can continue to build a unique platform and empower our community of more than 18 million artists to share their work and connect directly with their fans. It also means listeners will have even more excellent music and audio to discover. (SoundCloud)